VinFast Sells $50M Convertible Debenture to Yorkville

TL;DR

**VinFast just raised $48.75M from Yorkville via a convertible debenture, watch for potential share dilution.**

AI Summary

On December 29, 2023, VinFast Auto Ltd. (VFS) issued a convertible debenture with a principal amount of $50.0 million to YA II PN, Ltd. (Yorkville) for a purchase price of $48.75 million. This debenture is convertible into ordinary shares of VinFast and is guaranteed by its subsidiary, Vingroup USA, LLC. This matters to investors because it represents a new source of financing for VinFast, but also introduces potential dilution if Yorkville converts the debenture into shares, which could impact the stock price.

Why It Matters

This filing indicates VinFast is raising capital through debt that can convert to equity, which could provide necessary funds for operations but also dilute existing shareholders.

Risk Assessment

Risk Level: medium — The convertible debenture introduces potential share dilution, which is a moderate risk for existing shareholders, but also provides capital to the company.

Analyst Insight

An investor should monitor VinFast's stock performance and future filings for any announcements regarding the conversion of this debenture, as conversion would increase the number of outstanding shares and potentially dilute existing shareholder value. While it provides capital, the potential for dilution warrants caution.

Key Numbers

• $50.0 million — Principal amount of Convertible Debenture (The total amount VinFast could owe if the debenture is not converted.)
• $48.75 million — Purchase price of Convertible Debenture (The actual cash VinFast received from Yorkville for the debenture.)
• December 29, 2023 — Date of Agreement (When VinFast entered into the securities purchase agreement and issued the debenture.)
• July 1, 2024 — Maturity Date (The date by which principal and interest must be paid in cash if not converted.)

Key Players & Entities

• VinFast Auto Ltd. (company) — the company issuing the convertible debenture
• YA II PN, Ltd. (company) — the fund managed by Yorkville Advisors Global, LP, purchasing the debenture
• Yorkville Advisors Global, LP (company) — the manager of the fund purchasing the debenture
• Vingroup USA, LLC (company) — the subsidiary guaranteeing the debenture
• $50.0 million (dollar_amount) — principal amount of the convertible debenture
• $48.75 million (dollar_amount) — purchase price of the convertible debenture
• December 29, 2023 (date) — date the securities purchase agreement was entered into and the debenture was issued
• July 1, 2024 (date) — Maturity Date for the convertible debenture

Forward-Looking Statements

• VinFast's cash position will improve in the short term due to the $48.75 million received. (VinFast Auto Ltd.) — high confidence, target: Q1 2024
• There is a medium likelihood of share dilution if Yorkville converts the debenture into ordinary shares. (VinFast Auto Ltd.) — medium confidence, target: July 1, 2024

FAQ

Key Financial Figures

• $50.0 m — ture”) in the principal amount of $50.0 million, which are convertible into ordin
• $48.75 m — Shares”) for a purchase price of $48.75 million, on the terms and subject to the
• $10.00 — set forth in the Convertible Debenture, $10.00 per ordinary share of the Company. The
• $51 million — ompany expects to receive approximately $51 million of funding in cash from Asian Star Trad

Filing Documents

• tm2333980d1_6k.htm (6-K) — 21KB
• tm2333980d1_ex99-1.htm (EX-99.1) — 181KB
• tm2333980d1_ex99-2.htm (EX-99.2) — 117KB
• tm2333980d1_ex99-3.htm (EX-99.3) — 96KB
• tm2333980d1_ex99-4.htm (EX-99.4) — 22KB
• 0001104659-23-130537.txt ( ) — 438KB

From the Filing

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 6-K REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 OF THE SECURITIES EXCHANGE ACT OF 1934 For the month of December 2023 Commission File Number: 001-41782 VinFast Auto Ltd. Dinh Vu – Cat Hai Economic Zone Cat Hai Islands, Cat Hai Town, Cat Hai District Hai Phong City, Vietnam (Address of principal executive office) Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F. Form 20-F Form 40-F INFORMATION CONTAINED IN THIS REPORT ON FORM 6-K Convertible Debenture On December 29, 2023, VinFast Auto Ltd., (the “Company”) entered into a securities purchase agreement (the “Securities Purchase Agreement”) with YA II PN, Ltd. (“Yorkville”), a fund managed by Yorkville Advisors Global, LP, headquartered in Mountainside, New Jersey. Pursuant to the Securities Purchase Agreement, the Company agreed to issue and sell to Yorkville a convertible debenture (the “Convertible Debenture”) in the principal amount of $50.0 million, which are convertible into ordinary shares of the Company (as converted, the “Conversion Shares”) for a purchase price of $48.75 million, on the terms and subject to the conditions set forth therein. The obligations of the Company in respect of the Convertible Debenture are guaranteed by its subsidiary, Vingroup USA, LLC, pursuant to global guaranty agreement, dated December 29, 2023 (the “Global Guaranty Agreement”). On December 29, 2023, the Company issued and sold the Convertible Debenture to Yorkville. Principal, interest and any other payments due under the Convertible Debenture shall be paid in cash on July 1, 2024 (the “Maturity Date”), unless converted by Yorkville or redeemed by the Company. Except as specifically permitted by the terms of the Convertible Debenture, the Company may not prepay or redeem any portion of the outstanding principal and accrued and unpaid interest thereunder. Subject to the terms set forth in the Convertible Debenture, at any time on or after the issuance date, Yorkville shall be entitled to convert any portion of the outstanding principal of the Convertible Debenture plus accrued and unpaid interest on such outstanding principal of the Convertible Debenture to, but excluding, the conversion date (such amount, “Conversion Amount”) into ordinary shares of the Company at the Conversion Price (as defined below). The number of Conversion Shares issuable upon conversion of the Conversion Amount will be determined by dividing (x) such Conversion Amount by (y) the Conversion Price. The “Conversion Price” means, as of any conversion date or other date of determination and subject to adjustments set forth in the Convertible Debenture, $10.00 per ordinary share of the Company. The Conversion Price will be adjusted from time to time pursuant to the terms and conditions of the Convertible Debenture. The Company at its option and in its sole discretion shall have the right, but not the obligation, to redeem (each, an “Optional Redemption”) early a portion or all amounts outstanding under the Convertible Debenture, provided that the Company provides Yorkville with at least ten scheduled trading days’ prior written notice (each, a “Redemption Notice”) of its desire to exercise an Optional Redemption. Each Redemption Notice will be irrevocable and will specify the date for the Optional Redemption (each, a “Redemption Date”), the outstanding principal of the Convertible Debenture to be redeemed and the Redemption Amount (as defined below) applicable to such principal. With respect to any Redemption Notice, the “Redemption Amount” will be an amount equal to the outstanding principal actually being redeemed by the Company (after giving effect to any conversions with a Conversion Date prior to the relevant Redemption Date) on the relevant Redemption Date, plus the applicable Redemption Premium, plus all accrued and unpaid interest on the principal amount being redeemed by the Company to, but excluding, the relevant Redemption Date. “Redemption Premium” means 5% of the principal amount being redeemed pursuant to an Optional Redemption. Yorkville may declare the full unpaid principal amount of the Convertible Debenture, together with interest and other amounts owing in respect thereof, immediately due and payable in cash upon the occurrence of certain specified events of default and mandatory prepayment event. Upon the occurrence and during the continuance of certain specified additional interest event, interest will accrue on the outstanding principal balance of the Convertible Debenture at a rate of 8% per annum. Upon the occurrence and during the continuance of any event of default, interest will accrue on the outsta

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View this 6-K filing on SEC EDGAR